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Longevity Factor
<br />In addition to loss ratios, a component has been added that recognizes the length of time a Member has participated in the
<br />individual Fund. The Liability and Warkers' Compensation equity returns shown in the preceding chart will be increased
<br />based on continuous membership in the applicable Fund as of September 30, 2008 as follows:
<br />Member's
<br />Loss Ratio
<br />Worktxs' Compensation Longevity
<br />Factor as a Percentage of Member's
<br />Estimated 2007-08 Contributions
<br />Liability Longevity Factor as
<br />a Percentage of Member's
<br />2007-08 Contributions
<br />1 to 2 years
<br />00/0
<br />
<br />00/0
<br />3 to 4 years
<br />100-----------
<br />
<br />
<br />- 20/o
<br />5 to 9 years
<br />
<br />20/o
<br />-
<br />30/o
<br />10 or more years
<br />40/o
<br />50/o
<br />Paof has returned approximately $85 Million Since 1993-94
<br />The Pool has a long history of reh.iming Members' Equity when fmancial results have been better than expected. Since 1993-94
<br />the Pool has retumed approximately $85 million to members of the Warkers' Compensation, Liability, and Property Funds,
<br />including the upcoming returns in April. Equity returns have been possible as a direct result of the Pool's members working hard
<br />to keep their losses down. The Pool's staffof professional Loss Prevention Representatives is available to assist members in their
<br />loss prevention efforts.
<br />History
<br />of Eq
<br />Fiscal Year
<br />Workers' Compensation
<br />Liability
<br />Property
<br />Pool Total
<br />93-94
<br />0
<br />$1,100,000
<br />0
<br />$1,100,000
<br />94-95
<br />$2,000,000
<br />0
<br />0
<br />$2,000,000
<br />95-96
<br />$2,700,000
<br />0
<br />0
<br />$2,700,000
<br />96-97
<br />$4,900,000
<br />0
<br />0
<br />$4,900,000
<br />97-98
<br />$1,400,000
<br />$2,800,000
<br />0
<br />$4,200,000
<br />98-99
<br />$1,400,000
<br />$3,500,000
<br />0
<br />$4,900,000
<br />99-00
<br />$1,500,000
<br />$3,100, 000
<br />0
<br />$4,600,000
<br />00-01
<br />0
<br />0
<br />0
<br />0
<br />01-02
<br />0
<br />0
<br />0
<br />0
<br />02-03
<br />0
<br />0
<br />0
<br />0
<br />03-04
<br />0
<br />$4,500,000
<br />0
<br />$4,500,000
<br />04-05
<br />0
<br />$4,900,000
<br />$4,300,000
<br />$9,200,000
<br />05-06
<br />0
<br />$5,000,000
<br />$3,200,000
<br />$8,200,000
<br />05-06*
<br />0
<br />$6,700,000
<br />0
<br />$6,700,000
<br />06-07
<br />$6,700,000
<br />$9,200,000
<br />$570,000
<br />$16,470,000
<br />07-08
<br />Total
<br />$8,100,000
<br />00,000
<br />$7,800,000
<br />600,000
<br />0
<br />8070,000
<br />$15,900,000
<br />$85,370,000
<br />In January 2007, the Board adopted a Liability Fund equity return policy resulting in an additional equity retum based on 2005-06 financial results.
<br />Property
<br />As discussed in the Pool's March Coverage newsletter, the Properiy Fund is facing important financing issues during the
<br />next 12 months, including the National Flood Insurance Program being only autharized through September 30, 2009,
<br />potential changes in the Texas Windstorm Insurance Program now being considered by the Texas Legislature, and, as a result
<br />of 2007-08 storms, the Pool's increasing costs of reinsurance which takes effect on May 1, 2009. Because of these concerns,
<br />the Board of Trustees at its April meeting determined that it is not financially prudent to authorize a properiy equity return
<br />for 2007-08.
<br />Questions? Cali 1-800-537-6655
<br />If you have questions about your equity return, ask for the Underwriting or Field Services Departments. For loss prevention
<br />assistance, contact the Loss Prevention Department.
<br />- eC~P249
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